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Appeared on: Thursday, November 22, 2012
SSD Prices Fall But Still Cost More Than HDDs

The price of solid-state drives (SSDs) have fallen over the past 18 months, but compared to hard drives the cost per gigabyte remains high.

Research conducted by price comparison service Idealo for the last 18 months based on data from European retailers showed that HDD prices have still not come close to returning to their pre-flood levels.

After having slightly decreased from €67.35 to €65.75 (€0.0835/GB to €0.0825/GB) in the 3rd Quarter of 2011, average prices of the most popular hard drives on Idealo sky-rocketed from the 3rd to 4th quarter of 2011 to €111.95 (€0.1367/GB). This was an unprecedented 70 percent increase in the average price of each hard drive.

In the subsequent three quarters of 2012, the average prices have slowly declined, but remain much higher than prices prior to the Thailand flood disaster. Average prices for each hard drive are still 47 percent higher in the third Quarter of 2012 compared to the average prices from the same quarter of 2011. The average price per GB in the third quarter of 2012 is €0.122/GB compared to €0.0825/GB in the third quarter of 2011.

Zhang stated that "HDD manufacturers now have greater pricing power than they did in 2011". The huge mergers between Seagate/Samsung and WesternDigital/Hitachi have created an oligarchy where the top hard drive manufacturers can keep hard-disk-drive prices inflated at the current high level.

On the other hand, the price data from Idealo indicates that SSD prices from European online retailers have continued their decent throughout the first three quarters of 2012.

Over the past six quarters, the average price of the most popular SSDs on Idealo declined most dramatically between the 2nd and 3rd quarters of 2011, from €256.68 to €236.15 (€1.69/GB to €1.54/GB), and between the 1st and 3rd quarters of 2012, from €224.94 to €177.31 (€1.45/GB to €1.21/GB). In 2012, the average price of the 50 popular SSD models decreased 24%, with the average per-GB price having fallen almost €0.30.

In 2012, the average price of SSDs with the largest storage capacity decreased by €213.11, with their average per-GB prices falling by nearly €0.50 over the previous three quarters. Other recent price research has also identified this trend of high capacity SSDs matching low-capacity per-GB prices.

While the lowest capacity SSDs decreased in price with the least velocity, the average per-GB prices of the 120GB to 256GB SSDs have nearly broken the €1/GB barrier. In the last quarter, SSDs with 120-128GB storage capacities had an average price of €1.01/GB and SSDs with 160-250GB storage capacities had an average price of €1.03/GB.

For years analysts have speculated that SSD technology would eventually replace an outdated and less efficient HDD technology. But even with the higher capacity drives dropping in price as dramatically as they have over the previous 18 months, iSuppli's Zhang believes that SSDs pose no current threat to HDDs.

According to IHS iSuppli, notebook models with hard disks larger than 500 GB and priced between $450-$550 accounted for the biggest share of the market. Idealo?s study showed 2.5" 500GB HDDs at €0.146/GB in the most recent quarter of 2012. The GB price of the largest capacity SSDs in Idealo's study (300 ~ 600GB) were €1.35/GB that same quarter, still over 9 times more expensive.